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Electric Mobility, Cooking, Energy Storage, & Decarbonization To Anchor Kenya Power’s Growth Plan

Kenya Power Lighting Company PLC (Kenya Power) owns and operates most of the electricity transmission and distribution system in Kenya. Kenya Power sells electricity to over 8.9 million customers. During the year ended 30th June 2022, Kenya Power recorded a 6.6% growth in sales to 9,813 gigawatt-hours, mainly supported by an expanding customer base, improved system efficiency, and an intensive countrywide loss reduction campaign geared towards tackling theft of electricity. This resulted into a KShs.3.5 billion profit after tax. Kenya Power added over 600,000 new customers in the last year.

To sustain profitability and grow shareholder value, Kenya Power is looking to leverage new business frontiers as part of its five-year Strategic Plan for the period 2023-2028. Some of the key pillars of this new growth plan include electric mobility, getting more Kenyans to shift to electric cooking, energy storage, and electrification of several sectors to support decarbonization.

Let’s take a look at some of these opportunities:

Electric Mobility

There are a lot of exciting developments in Kenya’s nascent electric mobility sector. There are now well over 20 startups in Kenya working in the electric motorcycle sector, led by companies like Ampersand, Roam, Ecobodaa, Fika Mobility, Stima Boda, Arc Ride, Powerhive, Mazi Mobility, Kiri EV and others. There are several more working in the electric bicycle, scooter, and micromobility sector led by Ebee, Arc Ride, Jua bike, and several other players. The electric bus side of things is now developing nicely as well, led by BasiGo and Roam. The electric four-wheeler segment has not been forgotten and is also getting some early traction with several players such as Hyundai, which offers the 64 kWh Hyundai Kona EV in Kenya, Driveelectric Kenya, Vaell, and Equator Mobility. On the charging infrastructure front, EVChaja, which already has a presence in several major Kenyan cities and towns, wants to lead the charge by providing a charging network around the country. Solutions Africa Ltd from Mombasa is bringing electric tuk-tuks to Kenya. The tuk-tuk segment is another important segment that is ripe for electrification.

Kenya’s grid is by powered 90% by renewables, led by geothermal, wind, hydro, and some utility-scale solar. There is a big opportunity for KenGen, Kenya’s largest electricity generating company and also largest operator of Kenya’s geothermal fleet, as well as Kenya Power, to unlock efficiencies and sell more kWh during the overnight off-peak periods to electric vehicle users, thereby generating more revenue. Kenya’s installed capacity is just over 3 GW. The peak demand is just over 2.1 GW. During the off-peak periods overnight, demand drops to around 1.3 GW. Earlier this year, Kenya Power acting CEO Rosemary Oduor said, “Kenya Power can supply electricity to charge 50,000 buses and two million motorcycles during off-peak hours.” Kenya Power is now working to take advantage of this opportunity. To help catalyze the process, Kenya Power has established an E-mobility Liaison Office which is mandated to develop a strategy to guide the company’s participation in e-mobility. The office also facilitates the company’s engagement with other stakeholders in e-mobility. During the current financial year, Kenya Power has set aside KShs.40 million to purchase 50 electric motorbikes, 3 electric vehicles, and construction of three electric vehicle charging stations for its own use, data collection, as well as for demonstration purposes.

Clean Cooking

According to the IEA Africa Energy Outlook 2022, Ghana, Kenya, and Rwanda are on track for full access to electricity by 2030 and can be good examples for other countries to follow. Although Kenya has made tremendous progress in increasing access to electricity, the main source of energy for cooking remains wood fuels and charcoal for the majority in rural and peri-urban areas. Liquid Petroleum Gas (LPG) is also widely used, especially in urban areas. The IEA Outlook finds that even to this day, 64% of Africans rely predominately on gathered wood, agricultural, and animal wastes as fuel for cooking. In Kenya this number is also above 50%.

People have been using wood, charcoal, and LPG for cooking because they believe that cooking with electricity is expensive. Tariffs for residential consumers in Kenya are around 20 cents/kWh. Kenya Power has therefore been going on a drive to promote electric cookers to stimulate demand. Kenya Power says, “To promote clean cooking using electricity, Kenya Power is working with various organisations that are involved in the e-cooking value chain, including manufacturers of modern electricity cooking gadgets, to carry out customer education on cooking with electricity. The Company carries out sensitisation sessions at its E-cooking Demonstration Centre which is located at Electricity House in Nairobi.”

Decarbonization

A lot of industrial and manufacturing processes are still carbon-heavy. The food and beverage sector is one of the sectors where there are opportunities for electrification as technology advances. Traditionally, breweries and manufacturers of other beverages have been using a lot of heavy fuel oil for their boilers in Kenya. For example, in its 2022 Sustainability Report, East African Breweries Limited (EABL) gave an update on the refurbishment of its boilers. So far, the company has managed to replace the old Heavy Fuel Oil (HFO) boilers in Nairobi and Kisumu with biomass boilers that use agricultural waste such as macadamia shells, sugar bagasse, coffee, woodchips, and rice husks. The biomass boilers became operational in June of this year, and EABL says that the boilers are currently operating at optimal capacity. The switch to biomass will help reduce its carbon emissions by 95% (about 34,000 tonnes) per year. As technological advancements in the sector progress, electrification of boilers could also be key focus areas in the long term. Electrification of evaporation and  pasteurization processes will be other important opportunities in the drive for decarbonization.

Several players in Kenya are exploring the green hydrogen space for ammonia production for fertilizers to help cut Kenya’s fertilizer import bill. There could be a big opportunity there as well for Kenya Power to power those electrolyzers.    Increasing the production of secondary steelmaking using  Electric Arc Furnaces (EAF) for the steel industry could be part of the bouquet of demand drivers, and Kenya could work towards being a regional hub for a greener steel industry powered by its abundant renewables. Tariffs for customers with a minimum load of 40 MW connected at 220 KV are generally quite favorable at around 4 cents/kWh off peak and 7 cents/kWh peak. There are also special economic zones in Kenya where the tariffs are around 4 cents/kWh at all times.

 
 
 
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Remeredzai Joseph Kuhudzai has been fascinated with batteries since he was in primary school. As part of his High School Physics class he had to choose an elective course. He picked the renewable energy course and he has been hooked ever since. At university he continued to explore materials with applications in the energy space and ending up doing a PhD involving the study of radiation damage in High Temperature Gas Cooled Nuclear Reactors. He has since transitioned to work in the Solar and Storage industry and his love for batteries has driven him to obsess about electric vehicles.

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